Not With My Home

In 2004, Egyptian immigrant Mohamed Nour and his wife, Heba, decided they could do better than their cramped two-bedroom apartment in Boston. They were expecting their second child, and rent was more expensive each year. They found a two-story, three-bedroom home on a tree-lined block in suburban Revere.

Nour, now 41, bought the house for $337,000. In 2007, the interest on his original adjustable-rate-mortgage loan shot up by 3 percentage points. He was able to refinance at a more favorable rate, but then in 2008, his 4-year-old son, Pheras, was diagnosed with a glioma, a malignant brain tumor. Nour, a limo driver, began missing work shifts to bring his son to chemotherapy treatments.

After a losing struggle to persuade his loan servicer, IndyMac, to modify the loan, Nour was told in that his only option was a forced sale to the bank for $170,000, roughly the house's present market value. Since Nour bought his home, values in Revere have plummeted 32 percent. Rejecting the so-called short sale, he asked for a loan modification at that current market value -- a mortgage he could afford. "If you're going to sell it to someone else for $170,000," he asked, "why won't you just resell it to me?" The bank refused.

Up to this point, Nour's story was like that of millions of other American home-owners. Stonewalled by the bank and without a lawyer, Nour seemingly had no options. That's when he discovered CityLife/VidaUrbana, an activist group in the Jamaica Plain neighborhood of Boston that works on housing issues.

Nour attended his first of CLVU's Tuesday-night meetings in November 2009. He was joined by dozens of homeowners like him -- behind on their payments, nearing foreclosure, in the middle of it, or close to eviction. As is the ritual for each newcomer to CLVU, Nour was asked to stand up, introduce himself, explain his situation, and then wield a 4-foot plastic sword and large shield, painted silver and emblazoned with the words "No One Leaves." The crowd shouted in unison: "What if the bank attacks?" Thrusting the sword and shield into the air, he replied: "Stand up and fight back!"

The experience changed Nour's mentality. "You feel embarrassed for something because you didn't pay your mortgage, and they're going to take your house from you," he says. "But when you're inside a group and some people they listen to you and they try to help you, I think you feel stronger and you try to fight to get your house."

The central tenet of CLVU's foreclosure activism is that no one should vacate a home until all legal options have been exhausted. Despite foreclosure, bank auction, and eviction notices, Nour never left. In a unique twist, he may also be able to buy back his home from a nonprofit community-development organization called Boston Community Capital.

Nour is lucky to live in Boston, which has become ground zero for modeling how to bring the foreclosure machinery to a halt -- and win back homes. Here, CLVU has partnered with Greater Boston Legal Services, Harvard Legal Services, and Boston Community Capital to provide homeowners peer support, legal resources, and in rigorously screened cases, an option to buy back a foreclosed home.

While the Boston model has yet to be fully replicated across the country, there are similar movements in the cities and states hardest-hit by the housing crisis. Some groups are rallying homeowners to confront banks with demands for loan modifications at shareholder meetings and protests outside of corporate offices. And for the most part, these aren't old hands at civil disobedience risking arrest at vigils and blockades in front of foreclosed homes; they are first-time activists. In many cases, the threat or experience of foreclosure has forged a newfound political identity for individuals who once saw themselves as just beleaguered homeowners. What they need now is a national movement to call their own.

In Boston, anti-foreclosure activism is methodically organized. Greater Boston Legal Services and Harvard Legal Services, both legal-aid groups, scour local notices and trade journals for listings of homes nearing foreclosure. Delegates from both organizations are then sent on door-knocking trips where they invite homeowners to the weekly CLVU meetings. Those who show up are referred to a clinic to review legal options with a lawyer or housing counselor.

GBLS and HLS lawyers also appear weekly at the Boston and Chelsea housing courts, offering their services and approaching homeowners without representation. Diminished state funding for legal-aid services has forced GBLS to turn away 60 percent of potential clients; the organization tries to focus on homeowners who can afford a modified mortgage payment or whose cases might change state law. As a case unfolds in court, the homeowner is encouraged to continue attending weekly CLVU meetings for emotional support, and also to participate in direct-action strategizing. "Someone who has gone through this process becomes a leader themselves," says Zoe Cronin, a GBLS lawyer.

Consider Melonie Griffiths, a former special-education teacher who was marketed a subprime loan. In late 2007, Griffiths had just agreed in housing court to move out of her foreclosed two-family, four-bedroom house in North Dorchester when she discovered CLVU. In January 2008, she received a 48-hour eviction notice. Instead of uprooting her three children with nowhere to go, she practiced the CLVU creed: No one leaves. Instead, dozens of volunteers blockaded Griffiths' home so the police could not physically remove her. She eventually did move, but only when she found an apartment down the street so her children wouldn't have to change schools.

Griffiths had never been involved in organizing, but she spent the next few years on the front lines of CLVU's No One Leaves initiative. She recently became the group's lead organizer. "People are comfortable here," Griffiths says. "It's the one place you're not ridiculed or blamed. But it also gets you angry ... when you see how similar everyone's story is."

In the fall of 2009, CLVU, GBLS, and HLS partnered with Boston Community Capital in a pilot program designed to win back homes for borrowers who could afford a lower mortgage payment but lost their house anyway. BCC provides the organizations with income tables and property-value charts by neighborhood in order to identify potential candidates for the program. Preliminary screening involves determining whether a reduced mortgage payment would equal no more than 38 percent of the client's gross income and whether the property value has dropped enough so that BCC can purchase the home from the lender and still offer it back to the client at a discount. Nearly 100 Boston residents have repurchased their homes through the project. CEO Elyse Cherry says BCC's novel program will need billions in funding before it can be taken to scale nationally.

Across the country, a broad coalition of embattled homeowners is emerging. Its member organizations include such community, labor, and faith-based organizing outfits as People Improving Communities through Organizing (PICO), National People's Action, Alliance for a Just Society, Industrial Areas Foundation Southeast, Alliance of Californians for Community Empowerment, and the Service Employees International Union. Together, these organizations have reached out to their 3.5 million members to offer foreclosure-resistance resources and opportunities to participate in direct action against banks.

A joint campaign called "Crime Shouldn't Pay" is designed to put public pressure on policy-makers and banks, often through embarrassing protests at meetings and corporate offices. Each organization also has its own locally specific initiatives, the tactics of which vary across the coalition. National People's Action, for example, supports an Iowa affiliate that organized hundreds of residents to pressure Attorney General Tom Miller, the architect of the proposed 50-state bank-settlement agreement, into hearing the concerns of homeowners.

The Alliance of Californians for Community Empowerment (ACCE) led its own statewide campaign called "Refund California," which is lobbying for two changes to state law: the institution of a $20,000 fee for servicers that improperly proceed with foreclosure, and a prohibition of "dual tracking," a practice that allows banks to foreclose before a loan-modification evaluation is complete. The ACCE, like the NPA and others in the coalition, works to connect homeowners with housing counselors and legal-aid services. The organizations have also found success in grouping cases by lender and then lobbying on behalf of those members in face-to-face meetings with bank representatives.

PICO, a network of faith-based activist groups in 17 states, has been using direct-action tactics against banks since 2008 as the foreclosure crisis developed. PICO pastors and organizers were hearing from a growing number of frustrated homeowners whose attempts to modify loans were routinely ignored by the banks. Such reports were particularly concentrated in the nine-county Bay Area where 2 percent of homes and condos would eventually be foreclosed on in 2008. An initial round of meetings produced only stonewalling.

"How do you build enough leverage and power over a bank that has 3.2 trillion in assets?" Tim Lilienthal, a PICO spokesperson asks. "It's David and Goliath, and you have to find a way to develop some slingshots." In November 2008, the group staged a prayer rally on the steps of the U.S. Treasury Building. As pastors prayed, 200 demonstrators implored administration officials to use the bailout as a way of halting preventable foreclosures.

Soon PICO was organizing Bank of America customers to close their accounts in protest of the bank's handling of foreclosure cases. Homeowners started appearing at shareholder meetings to confront bank executives. At a May 2010 JPMorgan Chase & Co. meeting, a PICO representative pressured CEO Jamie Dimon into setting up a meeting between the organizing group and JPMorgan's home-lending director.

Such tactics have worked for Ken Kelly, an Antioch, California, homeowner. In the fall of 2009, Kelly attended a meeting at the Contra Costa Interfaith Supporting Community Organization, a PICO affiliate. At the time, Kelly was trying to finalize a loan modification from Bank of America for the mortgages on his two-story, five-bedroom home. A general contractor, Kelly bought the property in 2002 for $289,000 and later took out a home-equity loan to help pay for his older child's college education. When the recession hit and new-home building stalled, his income quickly dropped.

After months of trying to obtain a loan modification from Bank of America, Kelly finally had an agreement in late summer of 2008. The monthly payment was steep, but Kelly felt he had no choice. "I thought this was better than losing the house," he says. Kelly submitted the notarized paperwork but never heard from the bank. Several months passed, and Kelly called to arrange a payment schedule. The bank representative mentioned a "gray area" in the paperwork and said it would need to be revised. Kelly says he was instructed to skip payments until the issue was resolved and was promised that the modification terms would remain the same. When the paperwork arrived in January 2010, however, the interest rate and payments were higher, and he'd been charged fees and penalties for two months of nonpayment. Kelly refused to sign it.

At the same time, PICO had long been trying to schedule a meeting with Barbara Desoer, president of Bank of America's home loans and insurance division. The bank finally agreed, and in February 2010, PICO selected nine of their most compelling cases and speakers and paid for the homeowners, among them Kelly, to travel to the sit-down at the bank's headquarters in Charlotte, North Carolina.

Armed with supporting documents, Kelly presented his experience to Desoer. A few days after returning home, the bank called, ready to offer him a modification through the government's Home Affordable Modification Program with more favorable interest and payment rates. Kelly estimates that his payments are $1,000 less than prior to the first modification. "They helped by getting me access to people who I could never get access to," Kelly says. Lilienthal estimates that roughly 100 PICO members have received loan modifications through the group's assistance.

Kelly, who is 44, had never before protested or been involved in activism. "I've never known the power of organizing and having your voice heard," he says. "I was thinking my part would be going to events and holding up a sign. But right off the bat, I was asked to speak, and it kept going from there."

As the organizing infrastructure evolves, more homeowners like Kelly will find a PICO, CLVU, or an NPA. But budget cuts are reducing the capacity of housing counselors and legal-aid attorneys. Bruce Dorpalen of the Affordable Housing Centers of America, a nonprofit counseling and brokerage agency for low-income individuals that has been approved by the Department of Housing and Urban Development, says that a 78 percent reduction in federal funding in the last year and a half has led to widespread cutbacks.

Mohamed Nour will find out in May whether Boston Community Capital can strike a deal with the bank to buy back his house, where he and his family still live. In the meantime, Nour continues to attend CityLife/VidaUrbana meetings and looks for opportunities to be more politically active. In January, he attended a protest held by Boston's Egyptian community, demonstrating against the Egyptian government's crackdown of democracy reformers. He has mentioned the possibility of moving to his children. His son, Pheras, who has finished chemotherapy but is not yet in remission, was resolute: "I'm not going anywhere," he said.

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